Coforge Shares Plunge 5% as Nifty 50 Struggles Below 25,500 Amid IT Sector Headwinds in February 2026

Indian equities are experiencing significant turbulence on February 24, 2026, with the Nifty 50 index trading sharply lower, sliding below the critical 25,500 mark. This broader market weakness has hit the IT sector particularly hard, seeing Coforge shares plunge by approximately 5% during the trading session, extending a six-day losing streak for the mid-cap IT firm. The downturn reflects growing investor anxiety surrounding the impact of Artificial Intelligence (AI) on IT service demand and cautious global cues, including renewed global tariff threats.

The Catalyst

The sharp decline in Coforge's share price and the broader Nifty IT Index today is largely attributed to a confluence of factors, with the looming influence of Artificial Intelligence taking center stage. The Nifty IT Index itself slipped over 3% in early trade, indicating a concentrated selling pressure across the technology sector. Global cues also played a role, as uncertainties surrounding potential new tariffs hinted at by former US President Donald Trump weighed on market sentiment, contributing to a substantial wipeout of investor wealth on Dalal Street. Specifically for IT, a cautious outlook from global peers like EPAM Systems, which saw a 17% plunge on the New York Stock Exchange after issuing conservative guidance, has rippled through the Indian mid-cap IT space.

Financial Forensics

On February 24, 2026, Coforge Ltd (NSE: COFORGE) witnessed significant value-based trading, yet its stock closed at ₹1,240.20, down 4.84% from its previous close of ₹1,289.00. This marks a notable intraday decline and continues a six-day losing streak, during which the stock has cumulatively fallen by 10.99%. The company's current price is barely above its 52-week low of ₹1,194.01, signaling critical support levels are being tested.

The market capitalization of Coforge currently stands at approximately ₹41,807.13 Crore (as of February 24, 2026). For the past three years, Coforge has delivered poor profit growth of -6.46%, a concerning trend for investors. The stock is currently trading below all key moving averages—5-day, 20-day, 50-day, 100-day, and 200-day—underscoring a sustained downward momentum.

While the broader Indian IT sector is poised for a moderate growth in fiscal year 2026, with overall IT spending in India projected to hit US$176.3 billion in 2026, driven by investments in data centers and AI, the current sentiment reflects a short-term struggle. Mid-sized IT companies like Coforge, while generally positioned for sustained growth, face challenges due to global macroeconomic conditions and evolving technological trends, particularly the rapid adoption of generative AI.

Coforge and Market Performance Comparison (as of February 24, 2026)

Index/Stock	Current Value (Approx.)	Daily Change (%)	Last 1-Month Change (%)	Last 1-Year Change (%)
Coforge Ltd	₹1,240.20	-4.84%	-22.39%	-15.34%
Nifty IT Index	31,700-32,000	-3.00%	-18.25%	-20.08%
Nifty 50	25,490.35	-0.87%	~-1.5%	+13.71%
Source: FinScann Analysis, NSE, MarketMojo, Business Standard

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Market Impact

The significant decline in Coforge and the broader IT sector has created a ripple effect across the Indian equity market. On February 24, 2026, the BSE Sensex also tumbled over 700 points, with the market losing approximately ₹2.94 lakh crore in investor wealth. While sectors like banking, metals, and FMCG have shown some resilience or even gains on other trading days in February, the IT sector's underperformance continues to be a drag on overall market sentiment. The Nifty 50 has seen considerable volatility, with the 25,500-25,400 zone acting as immediate support and the 25,800-26,100 zone as a critical resistance. The current drop places the Nifty firmly below its previous support levels, increasing concerns about further downside if sustained buying pressure does not emerge.

Key Takeaways for Investors

• IT Sector Under Pressure: The Indian IT sector, particularly mid-cap players like Coforge, faces significant headwinds from global macroeconomic uncertainties and the transformative impact of AI on service demand.
• Technical Weakness: Coforge shares are technically weak, trading below crucial moving averages and nearing their 52-week low, suggesting potential for further price correction.
• Nifty at Critical Levels: The Nifty 50 struggling below 25,500 indicates broader market caution. Investors should monitor the 25,300-25,000 range as key support.
• Selective Approach: While IT faces challenges, other sectors like PSU banks, auto, and financials have shown strength. A selective, diversified approach may be prudent.
• Long-term IT Outlook: Despite short-term pain, India's IT spending is projected for robust growth in 2026, especially in data centers and AI. Long-term investors might view current corrections as opportunities for fundamentally strong companies.

FinScann Verdict

The current dip in Coforge shares and the Nifty 50's struggle beneath 25,500 reflect a crucial period of re-evaluation for the Indian equity markets. While the IT sector grapples with the disruptive potential of AI and global economic jitters, FinScann analysis suggests that investors should exercise caution. Monitor Coforge's technical levels closely, especially its proximity to the 52-week low, and watch for the Nifty 50 to hold the 25,300-25,400 support zone. Prudent investors should prioritize portfolio diversification and consider fundamentally strong IT players capable of adapting to the evolving AI landscape for long-term growth.

Q: What is causing the current decline in Coforge shares? A: The decline in Coforge shares is primarily driven by broader IT sector weakness, largely influenced by growing investor anxiety about the disruptive potential of Artificial Intelligence (AI) on IT service demand, and cautious outlooks from global IT peers. Broader market sentiment, including concerns over global tariff threats, also contributes.

Q: What is the significance of Nifty 50 trading below 25,500? A: Nifty 50 trading below 25,500 indicates a bearish sentiment in the broader market. This level is considered a critical support zone, and a sustained break below it could signal further downward momentum for the index.

Q: Is the Indian IT sector's long-term outlook still positive despite these challenges? A: Yes, the long-term outlook for the Indian IT sector remains robust. While short-term challenges exist, particularly due to AI-led disruptions, total IT spending in India is projected to reach US$176.3 billion in 2026, driven by strong investments in data centers and AI infrastructure. This suggests a period of transformation rather than a complete downturn.

Q: Where can I find official information about Indian stock markets? A: You can find official information on the National Stock Exchange (NSE) website at www.nseindia.com, the Bombay Stock Exchange (BSE) website at www.bseindia.com, and regulatory bodies like the Securities and Exchange Board of India (SEBI) at www.sebi.gov.in and the Reserve Bank of India (RBI) at website.rbi.org.in.

Q: What should investors do amidst this volatility? A: Amidst current volatility, investors should maintain a cautious and informed approach. It is advisable to review portfolio diversification, focus on fundamentally strong companies, and avoid panic selling. Monitoring key technical levels for Coforge and the Nifty 50 is crucial, and considering the long-term growth prospects of sectors, especially IT's adaptation to AI, is essential. Consulting a SEBI-registered financial advisor is recommended.

Disclaimer: For information only; not investment advice. Stock market investments carry risks. Please consult a SEBI-registered advisor before investing. FinScann assumes no liability for decisions made based on this report.